New World Hits Obstacle in Bid for Kenner Parker

New World Entertainment’s hostile takeover bid for Kenner Parker Toys Inc. ran into trouble Friday when a Massachusetts Superior Court judge temporarily restrained the Los Angeles company from buying any more shares in the toy maker.

A New World spokesman said it will appeal the order, which bars it from buying any Kenner shares on the open market or in private or from taking any steps to acquire the Beverly, Mass., firm, whose products include Care Bears, Play-Doh and Monopoly. Much-smaller New World, which makes low-budget movies and publishes Marvel Comics, owns an 8.4% stake in Kenner.

In trading Friday, Kenner Parker fell $1.25 to close at $44.375, while New World closed at $10.125, up 12.5 cents.

The Massachusetts judge issued the temporary order after Kenner Parker filed suit Thursday, claiming New World violated a 10-year-old state law which would require the company to wait two years before launching a hostile takeover.

New World lost another legal battle Friday when a federal district judge in Boston refused to temporarily block the enforcement of the Massachusetts law. The federal court said New World would have to exhaust its appeals in state courts before it would review the case.

Thursday’s takeover bid followed Kenner Parker’s rebuff of a friendly takeover attempt two weeks ago. Kenner has said its shareholders would be better off if the toy company remains independent.